The American Power Act: A View from California

Today’s release of the long-awaited climate bill by Senators Kerry and Lieberman has set D.C. abuzz. As everyone delves into the details of this initial proposal (aka the “American Power Act”), it’s clear that this announcement marks real progress in the fight against climate change.

Most importantly, the formal proposal reignites the prospect that our country will take real action this year to reduce our dependence on oil and produce more American-made power and clean energy jobs. Amidst the Gulf Coast oil spill and a high national jobless rate, this energy bill is exactly where national leaders should be focusing.

Our colleagues in D.C. that have tracked this effort closely believe the draft is a good starting point for a bipartisan conversation. Among its key provisions are:

Strong goals for reducing carbon emissions and protecting the climate

Significant consumer protections against cost increases, and

Provisions to ensure environmental safeguards of any domestic energy production

So with all the attention focused on the announcement back east today, what does this proposal mean for California? Here are a few thoughts:

1) California, with our history of groundbreaking energy policy, made this bill possible.

Our state has demonstrated conclusively over the last 30 years that bold new approaches can reduce energy use, cut pollution and save people money. The average Californian now uses a fraction of what's used by the average American each day, while our state's economic output has outpaced the rest of the country. More recently, California's actions in 2006 to pass the nation's first comprehensive climate change law—AB 32—has shaped the national conversation and led to innovative approaches within the proposed Senate bill.

2) Our early action on energy and climate will benefit California financially under the American Power Act.

In the current draft of the American Power Act, early actions taken to reduce energy and greenhouse gas pollution will be officially recognized by the federal program. In some instances, California businesses will receive compensation for investments already made to reduce pollution. As California’s transition to clean energy continues, our state’s residents and businesses will continue to benefit from growing clean tech investment and jobs creation in this area.

The larger the market for carbon emission reductions, the more pollution we take out of the atmosphere. The news that the Act will create national markets for reducing pollution is a great development. What still needs to be discussed is the role that States will play in these markets and what States can do in addition to these proposed federal actions. California businesses and consumers have saved billions of dollars through our state's energy policies and clean technology companies are creating thousands of jobs here in California as a result of this policy leadership. We want to ensure this California's ability to innovate is preserved in any federal climate bill. Getting the balance right between federal action and allowable state actions is critical. Over the coming weeks, EDF will be working to help the Senate achieve this balance in the bill.

4) The fight against oil companies to preserve California’s clean energy laws has never been more important.

The current attack by Texas oil companies that on California's clean energy and jobs policy—AB 32— has never been greater. If these oil companies are successful at killing clean energy policy in California, this rollback will have a damaging, chilling effect on passing strong federal clean energy laws. Oil companies’ attempted roll back AB32 would also mean taking away economic rewards that California businesses will receive through a federal climate policy. As our private sector takes early action to reduce energy use and pollution, they are lowering operating costs and racking up savings. In the current proposal of the federal bill, these actions will be rewarded. Killing AB 32 would take this money away from California businesses.

Important areas of the bill still need to be negotiated and members will have the opportunity over the coming weeks to shape the bill as it moves to the Senate floor. We now have a foundation for those conversations. EDF will be doing everything we can – working in and outside of the Senate – to help ensure a strong bill and to help achieve the votes it needs to pass in the Senate.